Thursday, 6 November 2014

Swiss Prosecutors Probe Nigerian Oil Marketers For Fraud

Nigerian oil commodity traders, including
Gunvor Group Limited and Vitol Group, have been contacted by Swiss
prosecutors in a fresh investigation into an alleged multi-billion
dollar scam over subsidies for petroleum product imports.

The commodity traders are said to be assisting the prosecutors in their investigations.

Gunvor,
the fifth-largest independent oil trader, said it was notified in June
by Switzerland’s attorney general that it was assisting a probe by the
Economic and Financial Crimes Commission of fraud involving local fuel
importers, according to a report by Bloomberg.

“The
Swiss authorities have requested from Gunvor assistance in gaining
understanding about product trading in Nigeria,” Seth Pietras, a
Geneva-based spokesman for the commodity trader, said in an e-mailed
response to questions.

Nigeria,
Africa’s largest crude producer, subsidises local companies to import
about 70 per cent of the nation’s petrol, diesel and other petroleum
products as aging and inefficient refineries cannot meet demand.

Fraudulent
payments related to subsidised fuel imports are estimated to cost the
continent’s biggest economy as much as $7bn a year, according to a 2012
report by the National Assembly.

The Swiss arm of the investigation is being handled by the Geneva prosecutor’s office, said a spokesman, Henri Della Casa.

“The Geneva prosecutor has acknowledged Nigeria’s request for assistance and is moving forward with an investigation,” Bloomberg quoted Della Casa as saying by phone.

Vitol
Group, the world’s largest oil trader, has also been contacted by Swiss
authorities regarding product imports to Nigeria, according to a person
with knowledge of the matter.

“Conversations
with government authorities are confidential,” Fabian Gmuender, a
spokesman for Amsterdam-registered Vitol, which has major trading
operations in London and Geneva, said in an e-mailed statement, adding,
“Vitol cooperates with all relevant authorities in all jurisdictions in
which we operate.”

The system of
fuel-import subsidies, which are supposed to be passed on to consumers,
is opaque and rife with “endemic corruption,” according to the April
2012 National Assembly report.

Two
months later, President Goodluck Jonathan dismissed the head of Nigerian
National Petroleum Corporation after the report said the state oil
company, the country’s biggest fuel importer, received illegal subsidy
payments.

Wilson Uwujaren, a spokesman for the EFCC, did not respond to phone calls and e-mails seeking comments.

Gunvor provided documentation to the Swiss prosecutor on the matter five months ago, said Pietras.

Cyprus-based
Gunvor is “happy to comply,” said Pietras, adding that no raids had
taken place at the trading house’s Geneva offices.